Organizations receiving federal funds know one thing for sure: 2 CFR Part 200 is non‑negotiable. The Uniform Guidance governs how every dollar is tracked, documented, allocated, and audited. But while the regulation is designed to create consistency, it often leaves teams overwhelmed by administrative burden, unclear cost principles, and the fear of audit findings. If…
Your company’s VP of Business Development traveled to a conference mixing customer meetings with recreational activities, charging the entire $8,500 trip to indirect costs—airfare, hotel, meals, golf outing, spouse travel, and entertainment expenses. During your incurred cost audit, DCAA questioned $6,200 of these costs, identifying unallowable entertainment charges, excessive meal costs beyond per diem limits,…
Your company incurred $145,000 in legal fees defending against an employment discrimination claim and $78,000 in consultant fees for “business advisory services”—both charged to indirect pools allocating across government contracts. During your incurred cost audit, DCAA questioned the entire $223,000, citing inadequate documentation supporting business purpose, lack of evidence demonstrating services were necessary and reasonable,…
Your company paid your CEO $875,000 in total compensation and charged the full amount to indirect pools allocating across all contracts including government work. During your incurred cost audit, DCAA applied the executive compensation benchmark limitation—currently $487,000 for the relevant year—and questioned $388,000 in excess compensation plus the associated fringe benefits and overhead allocation, totaling…
Your company allocated IT department costs using headcount—each employee charged equal share regardless of actual technology consumption—while facilities costs allocated based on direct labor hours even though office space usage had no relationship to project effort. During your accounting system audit, DCAA discovered that your engineering contracts requiring minimal IT resources subsidized administrative operations with…
Your DCAA auditor traced September labor costs from contract invoices backward through job costing to general ledger to payroll registers to approved timesheets—and discovered that timesheet hours totaled 8,240 for the month while payroll processed 8,460 hours and general ledger recorded $486,000 in labor costs that didn’t reconcile to either source. The 220-hour discrepancy, combined…
Your company discovered that salaried engineers routinely worked fifty to sixty hours weekly but recorded only forty hours on timesheets because “that’s what management expects from exempt employees.” During DCAA’s incurred cost audit, investigators found systematic underreporting of actual hours worked, concluded your labor distribution didn’t reflect reality, and questioned $1.3 million in direct labor…
Your company migrated to a popular cloud-based timekeeping platform promising “DCAA compliance in minutes” with automated features, mobile access, and seamless integration. During your accounting system audit, DCAA discovered the system allowed employees to edit historical timesheets without supervisor re-approval, lacked audit trails showing who changed what and when, permitted supervisors to modify employee entries…
Government contractors face a unique challenge: meeting stringent Defense Contract Audit Agency (DCAA) requirements without breaking the bank on enterprise-level software. If you’ve researched DCAA-compliant timesheet systems, you’ve likely encountered solutions with hefty price tags, complex implementations, and features you’ll never use. The good news? DCAA compliance doesn’t require an enterprise budget. The Enterprise Software…
Your company runs best-in-class systems across operations—ADP for payroll, Deltek for project accounting, Concur for expense management, and a specialized timekeeping platform for DCAA compliance. Each system excels individually, but during your incurred cost audit, DCAA auditors discovered labor costs in Deltek didn’t match timesheet totals, expense allocations in Concur used different project codes than…
